Deck 1: The Nature of Strategic Management

Question 1

According to Albert Einstein, "Knowledge is far more important than intuition."

Answer 1

False

Question 2

Although the Internet has increased in popularity, it has actually led to increases in company expenses.

Answer 2

False

Question 3

Management by intuition can be defined as operating from the "I've-already-made-up-my-mind-don't-bother- me-with-the-facts mode."

Answer 3

False

Question 4

As of 2006, the largest company in the world was ExxonMobil.

Question 5

Analytical and intuitive thinking should complement each other.

Question 6

Anything the firm does especially well compared to rival firms could be considered a competitive advantage.

Question 7

One of the fundamental strategy evaluation activities is reviewing external and internal factors that are the bases for current strategies.

Question 8

In 2007, Toyota surpassed General Motors as the world's top producer of cars

Question 9

Strategy implementation is often considered to be the most difficult stage in the strategic-management process because it requires personal discipline, commitment and sacrifice.

Question 10

A vision statement is, in essence, a company's game plan.

Question 11

Optimizing for tomorrow the trends of today is the purpose of strategic management.

Question 12

Newspaper companies in the United States provide a good example of how a company can sustain a competitive advantage over the long term.
f; difficult; p. 9;

Question 13

Strategy formulation, implementation and evaluation activities occur at three hierarchical levels in a large diversified organization: corporate, divisional and functional.

Question 14

The underpinnings of strategic management hinge on managers gaining an understanding of competitors, markets, prices, suppliers, distributors, governments, creditors, shareholders and customers worldwide.

Question 15

An objective, logical, systematic approach for making major decisions in an organization is a way to describe the strategic-management process.

Question 16

By monitoring external events, companies should be able to identify when change is required.

Question 17

The terms strategic management and strategy implementation are synonymous.

Question 18

Resource allocation is included in strategy-formulation activities.

Question 19

Even though useful, strategic planning has been cast aside by corporate America since the early 1990s.

Question 20

Strategic management is an attempt to organize qualitative and quantitative information in a way that allows effective decisions to be made under conditions of uncertainty.

Question 21

Strengths and weaknesses are determined relative to competitors.

Question 22

Customers spent more money online for clothes than they did on computers.

Question 23

In a multidivisional firm, objectives should be established for the overall company and not for each division.

Question 24

In the last five years, the position of chief strategy officer CSO) has diminished in comparison to other top management ranks of many organizations.

Question 25

Objectives should be measurable, quantitative, challenging, realistic, consistent and prioritized.

Question 26

The middle manager is the most visible and critical strategic manager.

Question 27

A vision statement answers the question, "What is our business?," whereas a mission statement answers, "What do we want to become?"

Question 28

In order for a firm to achieve sustained competitive advantage, a firm must continually adapt to changes in external trends and events and effectively formulate, implement, and evaluate strategies that capitalize upon those factors.

Question 29

Once an effective strategy is designed, modifications are rarely required.

Question 30

A clear mission statement describes the values and priorities of an organization.

Question 31

Application of the strategic-management process is typically more formal in larger and well-established organizations.

Question 32

Followed by commitment, understanding is the most important benefit of strategic management.

Question 33

Identifying an organization's existing vision, mission, objectives and strategies is the final step for the strategic management process.

Question 34

Consumer e-commerce is five times greater than business-to-business e-commerce.

Question 35

All strategists have similar attitudes, values, ethics and concerns for social responsibility.

Question 36

Annual objectives are long-term milestones that organizations must achieve to reach short-term objectives.

Question 37

Strategists are usually found in higher levels of management and have considerable authority for decision-making in the firm.

Question 38

Annual objectives are especially important in strategy formulation.

Question 39

Currently, online shopping accounts for almost 15 percent of all shopping.

Question 40

According to research, a healthier workforce can more effectively and efficiently implement strategies.

Question 41

Strategic-management must be a self-reflective learning process that familiarizes managers and employees in the organization with key strategic issues and feasible alternatives for resolving those issues.

Question 42

Low-performing firms typically underestimate their competitor's strengths and overestimate their own firm's strengths.

Question 43

All organizations have a strategy from their inception, even if the strategy is informal, unstructured, and sporadic.

Question 44

An integral part of the responsibility of all managers is to provide ethical leadership by constant example and demonstration.

Question 45

Top managers making many intuitive decisions that conflict with the formal plan is one pitfall managers should avoid in strategic planning.

Question 46

Firms with planning systems more closely resembling strategic-management theory generally exhibit superior long-term financial performance relative to their industry.

Question 47

Firms can be more proactive with strategic management.

Question 48

One risk in international operations is that nationalistic factions could seize the operations.

Question 49

Today, managers and employees can be found personally liable if they ignore, conceal, or disregard a pollution problem.
t; medium; p. 21;

Question 50

An integral part of strategy implementation must be to evaluate the quality of the strategic-management process.

Question 51

Merely having a code of ethics is not sufficient to ensure ethical business behavior.

Question 52

The poor reward structure is one reason managers do not engage in strategic planning.

Question 53

According to Greenley, strategic management provides a cooperative, integrated and enthusiastic approach to tackling problems and opportunities.

Question 54

Managers must be very formal in strategic planning because formality induces flexibility and creativity.

Question 55

The changes that occurred at Disney after Robert Iger took over as CEO exemplifies the fact that more and more organizations are centralizing the strategic-management process.

Question 56

In most situations, business strategy is very different than military strategy.

Question 57

International operations can be as simple as exporting a product to a single foreign country.

Question 58

The largest payout for a class-action legal fraud suit was for $7.16 million against Enron.

Question 59

Nonprofit organizations have less need for strategic management because they are not interested in making a profit.

Question 60

Crises and fires in an organization allow managers the training and time for effective strategic planning.

Question 61

Who is the world's top producer of cars?

A) Hyundai
B) General Motors
C) Toyota
D) Ford
E) Honda

Question 62

What step in the strategic development process involves mobilizing employees and managers to put strategies into action?

A) Formulating strategy
B) Strategy evaluation
C) Implementing strategy
D) Strategic advantage
E) Competitive advantage

Question 63

Strategy evaluation is necessary because

A) internal and external factors are constantly changing.
B) the SEC requires strategy evaluation.
C) competitors change their strategies.
D) the IRS requires strategy evaluation.
E) firms have limited resources

Question 64

Who was the top online apparel retailer in 2007?

A) Victoria Secrets
B) L.L. Bean
C) Sears
D) Wal-Mart
E) Gap

Question 65

The one factor that has most significantly impacted the nature and core of buying and selling in nearly all industries has been

A) the Internet.
B) political borders.
C) corporate greed.
D) customer and employee focus.
E) the government

Question 66

The term "environment" includes all of the following except:

A) air.
B) water.
C) firms.
D) natural resources.
E) fauna

Question 67

During what stage of strategic management are a firm's specific internal strengths and weaknesses determined?

A) Formulation
B) Implementation
C) Evaluation
D) Feedback
E) Goal-setting

Question 68

Anything that a firm does especially well compared to rival firms is referred to as:

A) competitive advantage.
B) comparative advantage.
C) opportunity cost.
D) sustainable advantage.
E) an external opportunity

Question 69

What is a theme that has become a more important strategic issue due to global warming, bioterrorism, and increased pollution?

A) internal environment
B) measuring performance
C) external environment
D) internal stakeholders
E) monitoring employees

Question 70

What percent of total sales are estimated to be completed online by 2016?

A) 7 percent
B) 15 percent
C) 20 percent
D) 60 percent
E) 85 percent

Question 71

_________ and _________ are external forces transforming business and society today.

A) E-commerce; strategy
B) E-commerce; globalization
C) Strategy; globalization
D) Corporate culture; stakeholders
E) Stakeholders; strategy

Question 72

Which statement best describes intuition?

A) It represents the marginal factor in decision-making.
B) It represents a minor factor in decision-making integrated with analysis.
C) It should be coupled with analysis in decision-making.
D) It is better than analysis in decision-making.
E) It is management by ignorance

Question 73

In December 2006, online sales in the U.S. rose by:

A) 10 percent
B) 25 percent
C) 50 percent
D) 100 percent
E) 150 percent

Question 74

____________ is used to refer to strategic formulation, implementation and evaluation, with ______________ referring only to strategic formulation.

A) Strategic planning; strategic management
B) Strategic planning; strategic processing
C) Strategic management; strategic planning
D) Strategic management; strategic processing
E) Strategic implementation; strategic focus

Question 75

What types of skills are especially critical for successful strategy implementation?

A) Interpersonal
B) Marketing
C) Technical
D) Conceptual
E) Thinking

Question 76

What can be defined as the art and science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives?

A) Strategy formulation
B) Strategy evaluation
C) Strategy implementation
D) Strategic management
E) Strategic leading

Question 77

Which phase of strategic management is called the action phase?

A) Strategy formulation
B) Strategy implementation
C) Strategy evaluation
D) Allocating resources
E) Measuring performance

Question 78

The trends in newspaper circulation in the United States provide support for which statement?

A) Sustainable competitive advantage is easy to maintain.
B) Several firms can have similar competitive advantages.
C) Some products are relatively immune to changes in the external environment
D) Most competitive advantages are hard to sustain
E) Competition is generally good for companies and consumers

Question 79

__________ is not a strategy-implementation activity.

A) Taking corrective actions
B) Establishing annual objectives
C) Devising policies
D) Allocating resources
E) Motivating employees

Question 80

An important activity in __________ is taking corrective action.

A) strategy evaluation
B) strategy implementation
C) strategy formulation
D) strategy leadership
E) all of the above